* Euro falls vs dollar, risk from revision to inflation data
* IMM data shows long dollar bets pared
* China yuan weakens after trading band widened over weekend
By Anirban Nag
LONDON, March 17 The euro fell against the
dollar and pared its gains against the yen on Monday as some
fretted that euro zone inflation data for February could be
revised down in its final reading, keeping pressure on the
European Central Bank to ease policy more.
The safe-haven yen slipped against the dollar as European
stocks edged up on expectations the West will impose only
limited sanctions on Russia after Ukraine's Crimea region voted
in favour of annexation by Moscow.
Over 95 percent of Crimean voters chose in a referendum to
join Russia on Sunday, an outcome that was denounced by Western
powers and Kiev as illegal and a sham.
While the risk of flare-ups in tension between Russia and
Ukraine is underpinning demand for safe-haven currencies like
the yen and the Swiss franc, the market's immediate focus this
morning is on final euro zone inflation data due at 1000 GMT.
A Reuters poll forecast no revision to the annual rate of
0.8 percent reported for February, but there is a risk it could
be revised down, keeping alive concerns about disinflation in
the euro zone.
"Our economists expect that the strong 0.8 percent which the
flash estimate produced will be revised downwards to 0.7
percent," said Ulrich Leuchtmann, currency strategist at
"This combined with fears that the March result might be
even lower is likely to keep alive speculation as to whether the
ECB might cut rates once more after all. The area around $1.3970
will have to constitute a natural barrier. In the end the
risk-reward-ratio is more attractive on the downside."
The euro was down 0.2 percent at $1.3883, off a
2-1/2-year high around $1.3967 touched last Thursday, before
European Central Bank President Mario Draghi knocked it lower
when he voiced concerns about its strength.
Against the yen, the euro was flat at 140.98 yen
off a session high of 141.34 yen struck in Asia. It remained
well shy of its March 7 high of 143.79 yen, which was its
highest since Jan. 2.
Some attributed the yen's resilience to short-covering along
with traditional safe-haven plays.
The latest data from the Commodity Futures Trading
Commission released on Friday showed that speculators pared
bullish bets on the U.S. dollar for a fifth straight week
through March 11, with net longs falling to their lowest in more
than four months.
Overall, though, investors have maintained net long
positions on the dollar for 19 consecutive weeks. The last time
speculators were short the greenback was in late October 2013.
A record drop in foreign governments' holdings of U.S.
Treasuries led some to speculate that Russia has been reducing
its dollar reserves ahead of possible sanctions from the West.
The dollar was up 0.2 percent at 101.58 yen, not far
from a two-week low of 101.205 yen struck on Friday and a far
cry from a 1-1/2 month high of 103.77 yen hit on March 7.
Investors were also considering the implications of
Beijing's announcement on Saturday that it will double the daily
trading range for the yuan. The step was viewed as a sign of
confidence that the central bank had successfully fought off
"Nothing forced them to widen the band this weekend, so it
will be seen as a continuation of long-term policy," Citi
strategist, Steve Englander wrote in a note. "I would see it as
slightly risk-on. Small positive for the Australian dollar,
small negative for the yen, but again a second-order impact."
The yuan weakened on Monday.